The “Asian markets” have become synonymous with “opportunity” in international business circles. 

Part of the reason for this is sheer scale. Over 4.7 billion people live in Asia. That’s around 60% of the total population of the Earth on one massive continent. 

It’s also a continent that’s growing. Rapidly. This growth is happening almost across the board. In technological innovation and capacity. In infrastructure. In stability. In economic growth above all else. 

The pace of economic change in Asia far exceeds anything in the “West”. Asian consumers are growing in number, in technological sophistication, and in purchasing power. 

Smart business leaders worldwide have started to realise this. But the diverse complexity of the Asian markets needs to be understood if businesses are to realise their potential: 

 

Understanding the diversity of the Asian markets 

Any time that someone refers to one single “Asian market”, they fail to grasp the sheer diversity of Asia. 

Asia’s landmass is roughly five times the size of Europe. This is a region of staggering linguistic and cultural diversity – over 2300 languages are spoken across the continent. 

There is a huge diversity in levels of economic development too. Countries like Japan, South Korea, Taiwan, and Singapore have highly advanced economies. Others, like China, India, and Indonesia are gigantic, but largely emerging. 

It only makes sense to link such a diverse set of countries – sometimes situated thousands of kilometres from one another – because of the linked systems of trade and interdependence within the region. 

Yet the overall growth of the Asian markets needs to be understood in a global context. It is, in a word, massive. The three largest countries in Asia alone will collectively add over 830 million consumers and several trillion dollars to global consumer spending by 2030. 

 

Economic growth and opportunities in Asia 

In 2024, the global GDP growth rate is estimated to be around 3.1%. In parts of Europe and the US, it is languishing around 1.4%. In Asia, it is expected to reach 5.2%. 

This is not a negligible difference. In parts of Southeast Asia though – Vietnam or the Philippines, for instance – it is expected to be even higher. 

Some of the key areas of economic growth and opportunities in Asia in the next decades will include: 

1) Ecommerce 

As well as headline growth figures, Southeast Asia is also increasingly full of keen online shoppers. 80% of its 700 million-strong population had made a recent online purchase according to a recent survey. 

This is partly because internet and smartphone penetration are hugely on the rise among Asian markets. 60 million Southeast Asian consumers started to buy online during the COVID-19 pandemic alone. 

This will lead to a heavy increase in demand for ecommerce options and availability in years to come. 

2) Manufacturing 

A great deal of Asian economic success in recent years has been in manufacturing. Several Asian countries have historically prioritised manufacturing capacity and maintained low labour costs that stimulated international demand for it. 

The legacy is an international reputation for manufacturing that belies the innovation and advanced consumer base that some parts of the continent have already been for decades. 

The example of Malaysia, for instance, shows a country where manufacturing remains a highly productive and valued industry. Yet it sits in the nation’s economy alongside a noted level of growth and achievement in fields like biotechnology and health services. 

However, many opportunities in Asia will likely continue to relate to its noted manufacturing capability. China, for instance, will be heavily involved in EV (Electric Vehicles) and green energy technology production. 

3) Technology 

Japan, China, and South Korea have long been noted technology hubs. Japan is famous for automotive technology, for instance. South Korea specialises in the advanced semiconductors that will be a key part of many future technologies. 

Several other Asian countries are becoming famous for the favourable business conditions they offer tech startups and becoming innovation hubs as a result. One of these is Vietnam (VinAI is of interest to us here at Asian Absolute for its English to Vietnamese translation technology). 

There is a rapidly expanding rate of technological adoption in Asian markets as a whole. For instance, the listed major Asian economies alone are expected to be responsible for over half of total global EV sales in just a few years. 

 

The benefits of expanding into Asian markets 

Tapping into Asian markets offers international businesses long-term growth and sustainability thanks to several key aspects of the region: 

1) Massive, growing consumer markets 

The already existing size and rate of growth of the Asian markets cannot be overstated. 

Many Asian economies are experiencing a rapid expansion of their middle classes too. The Asian middle classes will be the largest in the world by the end of the 2020s, increasing by a whopping 25% from their already impressive size. 

This is likely to mean a concomitant rise in disposable income among these huge consumer bases. 

2) Favourable business environments 

Many Asian nations rank highly on lists of countries that are easy to do business with: 

  • Singapore – is famous for its government’s pro-business policies, with an easy registration process and low tax rates. The Startup SG program offers entrepreneurs everything from mentorship to startup capital by way of enticement to set up shop here. 
  • Hong Kong – setting up a business in Hong Kong is similarly easy for foreigners, with the ability to expand into other Asian markets and low taxes. Hong Kong also has preferred trade terms with China. 
  • Malaysia – offers tax incentives and special economic zones to attract foreign investment. Kuala Lumpur is renowned for its electronic platforms and speed of property transfer and construction approval laws. 
  • Thailand – has investment policies that prioritise free trade and offers additional incentives to businesses that deliver technological innovation. The country’s EEC (Eastern Economic Corridor) is a special economic zone offering further benefits. 
  • Vietnam – has heavily supported its tech industry for years. It provides superior legal protections for startups, funding, and even protection when accessing technology from abroad. Perhaps 3000 startups have so far found it to be the ideal home. 

Many Asian countries are seeking to attract investment and businesses to specific industries and offer tax breaks accordingly. For instance, Thailand offers many tax advantages to automotive manufacturers and Singapore to chemical manufacturers. 

3) Trade partnerships 

Many Asian nations have double tax treaties with each other and many benefit from at least two key trade partnerships, namely: 

  1. ASEAN – the Association of South-East Asian Nations is a body of 10 countries that share free trade policies or low tax rates. ASEAN also has free trade agreements with Australia and New Zealand. 
  1. The CPTPP – the Comprehensive and Progressive Agreement for Trans-Pacific Partnership reduces or removes tariffs on goods and services across multiple industries. 

These agreements are excellent for international businesses that want to be assured of the best possible rates when trading across borders. 

 

Overcoming challenges and leveraging opportunities 

None of this is to say that Asian markets are immune to the challenges of any group of markets, such as: 

1) Legal framework diversity 

One of the key challenges for foreign businesses attempting to enter Asian markets is understanding the diversity of legal frameworks. Each country on this huge landmass may have different: 

  • Political environments, regimes, or political tensions (e.g. between the US and China) 
  • Regulatory constraints or requirements 
  • Tax policies (or breaks available) 
  • Data protection laws 
  • Rights relating to key business assets like Intellectual Property 

Any expansion into a given Asian market should be treated as a unique case, requiring specific expertise in that market as well as comparisons with other regional options. 

2) Language barriers 

The 2300 languages spoken across Asia don’t map neatly onto national borders. 

Take China as an example. The official language of mainland China is Standard Chinese (sometimes casually referred to as “Mandarin”). But there are hundreds of varieties of Chinese spoken in the country. 

These are split between 10 officially recognised dialect groups (there are arguably more). Some of these are not mutually intelligible. Even within the same province there may be notable differences or unintelligibility – for example, between rural and urban speakers. 

This is all to underline the importance of working with a Language Service Provider that has the expertise in a given region to advise on linguistic matters. 

3) Cultural differences and nuance 

A linked point is the critical need to understand cultural differences and nuance. And, thus, the absolute necessity of extensive market research. 

Any generalisations about “the Asian market” are immensely dangerous for any brand’s reputation in any country in the region. 

Each Asian market has its own features and culture – potentially several languages spoken, different ethnic groups, regions, business practices, a unique economic situation. 

Adapting your offering to local cultural and linguistic norms, expectations, and preferences is key to success. 

Again, this means that having a local partner and undertaking extensive research are impossible to avoid if you want to succeed in the increasingly relevant and profitable Asian markets. 

 

Asian market entry case studies – what we can learn 

1) IKEA vs Home Depot – market knowledge is critical 

Though IKEA and Home Depot are in the same industry, the Swedish home goods manufacturer succeeded in its Asian market entry. The American home improvement company did far less well. 

This was due to an essential failure to understand what Asia’s – particularly China’s – emerging middle class meant for the home improvement sector. 

Home improvement requires a person to have some DIY skills. China’s large and growing middle class is a relatively recent phenomenon and has access to comparatively few resources for learning how to improve their new homes. 

IKEA not only provided manuals as to how to equip a home (using IKEA products, of course) but also sold more of the products that middle-class Chinese consumers were looking for. 

2) WeChat – scale goes a long way 

WeChat originated in China, but expanded into the wider Southeast Asian market with great fanfare. Now, more than 50% of all Southeast Asian smartphone users prefer WeChat for messaging.  

As a result, the brand hit an estimated £158 billion in transactions three years earlier than expected. 

3) Starbucks – innovation can breed success 

The clear Chinese cultural preference has always been for tea. Several decades ago, Starbucks set out to change that. 

On the surface, this seemed a risky move. There was little surface indication that Chinese consumers were crying out for a new preferred beverage. 

However, Starbucks’ market research led it to believe that there was space for a concept called the “third place” (neither office nor home) that their cafes could provide. 

Turns out, it was right. There are currently over 6800 Starbucks stores in China, more than any country in the world save the US. 

 

The growing relevance of Asian markets to international businesses 

A bigger customer base. More profits. A sustainable future. Businesses seek to enter new markets for all sorts of reasons. 

The massive Asian markets offer international companies all this and more. Plus, these markets are set to grow in spending power faster than anywhere in the world. 

Specific Asian markets also offer highly favourable business environments and all kinds of support for foreign businesses seeking to establish themselves. 

Like any region, Asian markets have challenges attached. Not least the need for extensive cultural and language expertise and adaptation based on thorough research and planning. 

Yet the benefits of expanding into Asian markets have never been clearer or more relevant for international businesses in almost any sector. 

Need to source the language expertise you need to expand into an Asian market? 

Let’s talk. Asian Absolute works with some of the biggest brands in the world, including The Financial Times, IKEA, and Coca-Cola when they entered markets in Asia. 

Reach out to us to talk about your latest translation project and get a free, no-obligation quote today.